Intermediary Bank

An intermediary bank refers to a third-party bank involved in cross-border remittances when there is no direct account relationship or correspondent banking relationship between the remitting bank and the receiving bank, in order to complete the transfer of funds. It is typically located between the remitting bank and the receiving bank, using its own account network with both banks to facilitate the transfer. It is commonly used in international trade telegraphic transfers (T/T), especially for remittances involving different currencies, different countries, or small banks. Note: The intermediary bank deducts handling fees, which reduces the actual amount received by the beneficiary; the intermediary bank's information must be accurately provided in the remittance instruction (such as the SWIFT code), otherwise it may cause delays or returns; an intermediary bank is not always necessary—if the two banks have a direct correspondent relationship, no intermediary bank is needed. Difference from 'correspondent bank': A correspondent bank directly provides services to another bank, while an intermediary bank acts as a bridge in the remittance chain and may not have a correspondent agreement directly with the remitting or receiving bank. Difference from 'advising bank': An advising bank is mainly used in letter of credit business, responsible for notifying the beneficiary, and does not participate in fund transfers.